Construction Executive: Recovering Money for Delays on the Job
Denver partner Laurin Quiat authored an article, "Recovering Money for Delays on the Job," which was published in the October 2009 edition of Construction Executive magazine.
According to Quiat, "No damages for delay clauses, common in construction contracts, limit a contractor's right to recover damages associated with construction delays beyond its control. While these clauses can lead to harsh results, exceptions to the no damages for delay clause have emerged to temper the financial implications. Recognized exceptions allowing contractors to recover damages include cases of fraud, misrepresentation or bad faith, and when 'active interference' by the owner or general contractor occurred. How can a contractor protect itself when it has been delayed by the active interference of the owner or another contractor?"
Quiat's article goes on to explain and provide examples of "active interference that have caused courts to ignore no damages for delay clauses," as well as principles contractors should keep in mind during the course of a project to improve their chances of recovery in the face of a no damages for delay clause.
Quiat concludes: "The active interference exception can limit the impact of a no damages for delay clause, but its application is uncertain because common delays are expected by the parties at the time they sign the construction contract. But contractors experiencing delays or problems due to an owner's or general contractor's conduct can maximize their chances of obtaining damages by carefully documenting problems. If a court finds that one of the parties to a contract actively interfered with another contractor’s work, the contractor should be allowed to recover delay damages despite an otherwise valid no damages for delay clause."
Click to read the full article from the Construction Executive website.